Every investor in Tuniu Corporation (NASDAQ:TOUR) should be aware of the most powerful shareholder groups. We can see that private companies own the lion’s share in the company with 30% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Clearly, private companies benefitted the most after the company’s market cap rose by US$40m last week.
In the chart below, we zoom in on the different ownership groups of Tuniu.
Check out our latest analysis for Tuniu
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
As you can see, institutional investors have a fair amount of stake in Tuniu. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. When multiple institutions own a stock, there’s always a risk that they are in a ‘crowded trade’. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Tuniu’s historic earnings and revenue below, but keep in mind there’s always more to the story.
Tuniu is not owned by hedge funds. Our data shows that BHR Winwood Investment Management Ltd is the largest shareholder with 24% of shares outstanding. In comparison, the second and third largest shareholders hold about 18% and 4.8% of the stock. In addition, we found that Dunde Yu, the CEO has 3.8% of the shares allocated to their name.
On looking further, we found that 51% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.
While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock’s expected performance. We’re not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
Our most recent data indicates that insiders own some shares in Tuniu Corporation. In their own names, insiders own US$9.2m worth of stock in the US$241m company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.
The general public, who are usually individual investors, hold a 26% stake in Tuniu. While this group can’t necessarily call the shots, it can certainly have a real influence on how the company is run.
Our data indicates that Private Companies hold 30%, of the company’s shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
We can see that public companies hold 21% of the Tuniu shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.
It’s always worth thinking about the different groups who own shares in a company. But to understand Tuniu better, we need to consider many other factors. For example, we’ve discovered 1 warning sign for Tuniu that you should be aware of before investing here.
Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
Find out whether Tuniu is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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